Google parent company Alphabet has announced plans to raise $80 billion to help pay for the massive AI infrastructure buildout it has planned, in a move that highlights how rapidly the cost of competing at the AI frontier is climbing.
Alphabet said Monday that it would sell that amount in stock and use the proceeds to fund “general corporate purposes, including capital expenditures to scale AI infrastructure and global compute.” Part of the plan involves selling $10 billion in stock to Berkshire Hathaway, the global holding company formerly led by Warren Buffett.
“The company is experiencing strong demand for its AI solutions and services from enterprises and consumers, at levels that are exceeding the company’s available supply,” Alphabet said. “By scaling its investments, the company seeks to expand its foundational infrastructure to support the significant growth opportunity ahead.”
The company added that the stock plan represented a way to “fund its investments in a balanced way while retaining a healthy balance sheet.”
Like other tech giants, Google has announced plans for a major increase in compute spending this year. At Google I/O last month, CEO Sundar Pichai said the company expects to spend between $180 billion and $190 billion on capital expenditure before the year is out. Google and other tech giants are expected to spend as much as $700 billion this year on AI capex, according to Bloomberg.
